1. Field of the Invention
This invention relates to the field of credit management.
2. Description of the Related Art
Effective credit management may be defined as the ability to balance the customers purchasing power with the financial solvency of the party granting the credit. Effective credit management improves profitability by minimizing bad debt, reduces Days Sales Outstanding (DSO) and reduces collection activities and the costs associated with collection activities. In addition, the ability to effectively manage credit is important for short-term cash flow as well as for long-term financial stability.
Currently, credit managers manage their accounts either manually with paper files, spreadsheets or various software packages. Paper files are cumbersome, difficult to maintain and ill suited to the increasingly automated credit management field. Existing Enterprise Resource Planning (ERP) software packages typically do not adequately support many credit management functions. For that reason, many users of existing ERP software packages also use secondary software for credit management to perform specific functions, such as financial analysis or credit scoring, for example. Moreover, such existing software packages are not believed to enable credit analysts to adequately distinguish gradations within the wide spectrum of credit customers and different types of credit review and to use that information to guide the credit decisioning process.